Here's what I love about GoPro

I went skiing this spring for the first time in eight years, and I was struck by how visible GoPro cameras and branding were all over the mountain and shops. On the slope nearest the base of the mountain, there was a GoPro banner, everywhere I looked there were at least a few people wearing GoPros, and many ski shops had GoPro logos in the windows. Even the concessions on the mountain had GoPro video displays and cameras and accessories for sale.

And then it struck me: Being "the brand" in a given space is a huge asset. You need to have a great product but you also need to have a brand that stands for the uses of that product and its aspirations. GoPro, whose S1 dropped last Tuesday, does this perfectly with its association with active sports and even its tag line "Be a hero." Even CEO Nick Woodman is an active surfer who embodies the GoPro user. his could also be said of Under Armour in a very similar space.

We also saw this with Snapchat, where, in addition to the product, the brand of the hip Southern California firm located on Venice Beach allowed it to beat out Facebook's disappearing image competitor Poke. And now, we hear Facebook is taking a second crack at this market as Snapchat's growth seems to be soaring. Even WhatsApp's brand, almost a nonbrand that stood for functional reliability and almost nothing else, played a role in its leadership position.

Many leading companies that come to mind have an element of owning the brand in their given space. Whether this comes as a result of leadership or plays a role in creating leadership is difficult to judge, but there is most certainly a correlation. And it often explains a significant part of the goodwill value that many companies hold on their balance sheets.

Key risks

With that said, there are key risks in the defensibility of the core product and in the brand's growth possibilities. The first risk is that of the functionality of GoPro being built into phones, as happened with Flip video camera. This is less likely given the durability and housing requirements of GoPro, but it's possible. Who knows how durable cellphones could conceivably get or the housings and mounts that could be built for them.

A larger concern is GoPro's aspirations of becoming a media company. Other than the brand—which is a substantial media asset—I'm not sure of the other leverage points.

The company could add one-button upload functionality to GoPro camera software so that users can easily send in their content to the GoPro media company for broadcast on TV or the Web. This would make the cameras and software a pipeline for an ongoing supply of extreme sports footage. However, user-generated content is likely to be much less compelling than that of pro athletes and professional creators.

One could argue that professional users of GoPro cams, the best content creators, are more likely to license the content they create to GoPro, but that argument seems tenuous at best. It seems like the pros are likely to license and sell their content based on deal factors outside of hardware or software.

GoPro becoming an adrenaline sports-media company seems to be largely a separate start-up effort—benefiting, no doubt, by brand and some possible software hooks. But there is no reason to see why it's a slam dunk versus ESPN's extreme sports content.

While the sales figures are impressive, this passage from the S1 is most concerning:

"Revenue for the three months ended March 31, 2014 decreased 8% to $235.7 million from $255.1 million for the three months ended March 31, 2013. Units shipped in the three months ended March 31, 2014 decreased 11% to 0.9 million from 1.0 million in 2013. Revenue and units shipped for the three months ended March 31, 2013 were impacted by production delays of our HERO3 Black edition capture device in the fourth quarter of 2012. These production delays correspondingly delayed shipments until the first quarter of 2013, which resulted in revenues in the first quarter of 2013 that did not reflect the traditional seasonality in our business."

First-quarter revenue dropped 8 percent from a year earlier. The company is saying a production delay in the fourth quarter of 2012, made first-quarter 2013 revenue HIGHER than it should have been. So it's not that a production problem this holiday season made this first-quarter 2014 bad, but rather that last year's comp was TOO GOOD. This production delay and shifting out of demand will no doubt be a key question management will need to answer prior to the IPO.

Commentary by Jon Steinberg, the president & chief operating officer of BuzzFeed. He is responsible for all business management, company operations, finance, and social advertising operations. Follow him on Twitter @jonsteinberg.